The Oklahoma Corporation Commission voted 2-1 on Tuesday to approve a plan to have customers of a public utility pay off more than $1 billion in fuel costs from a winter storm in February 2021.
The storm caused widespread power outages and prompted utilities to purchase emergency fuel at incredibly high rates. Oklahoma Natural Gas paid more than $1.3 billion in added costs, which is now the subject of a payment plan for customers.
Under the now-approved securitization plan, the average residential ONG customer can expect to pay an additional $7.82 per month for the next 25 years. The increase will not be present on bills until late 2022 or 2023.
Commissioners Todd Hiett and Dana Murphy voted in favor of the plan and said spreading using securitization to spread the cost over decades prevents ONG from charging customers hundreds of dollars more every month.
“There is no getting around the fact that under state law, regulated utilities can pass fuel costs to the consumer," Hiett said in a statement.
"The costs incurred during the storm were part of an all-out effort to keep lights on and furnaces working. Without the securitization law, the costs would be even higher for ratepayer. Of key concern now is what is being done to reduce the changes of this happening again. The Commission has held a number of hearings on this since the storm, and it’s an ongoing effort.”
Commissioner Bob Anthony wrote a dissenting opinion to the proposed plan, where he questioned whether it is constitutional for the OCC to make these plans with utilities like ONG and OG&E.
"In my opinion, these stipulated Ratepayer-Backed Bond proposals are ill-conceived, unconstitutional, and bad for residential ratepayers," Anthony wrote in the dissent. "Worse, they also appear to be an attempt to prevent thorough and open examination of questionable, possibly negligent utility management decisions and imprudent fuel/service purchases made during the storm..."
The ONG securitization plan does not include a proposal to charge a termination fee, also called an “exit fee” for utility customers that choose to switch to other forms of energy providers, such as solar.
A spokesperson for ONG said following the commission vote that it looks forward to moving forward without the exit fee.
“The termination fee was not originally proposed by ONG and we want to reiterate the intent was never to restrict the choice of ONG customers’ access to energy sources,” said ONG Public Relations Manager Liza Steger. “Now that the decision has been made to approve the securitization mechanism and to remove this termination fee, we look forward to working with the OCC and the ODFA throughout the remainder of the process.”